Report: Baltimore-area rents up -- a lot
Average rents in the Baltimore metro area this summer jumped nearly 10 percent from what they were a year ago, according to real estate research firm Delta Associates.
"Demand for rental housing in the Baltimore area has improved and fundamentals are looking strong as supply comes into line with demand," the firm says in its newest apartment report, out this week.
The average rent during the summer was about $1,470 a month, Delta Associates says. This is the "effective" rent, the average once concessions and rent specials are subtracted out. The value of these deals is dropping, pushing up the total.
Also behind the increase: fewer empty units.
Delta Associates, which surveys the nicer garden and high-rise complexes known as "Class A," says the vacancy rate is down slightly to 3.6 percent in the metro area. That compares with a national rate of 6.6 percent. (What that vacancy rate doesn't include are buildings still in the process of initial lease-up.)
Effective rents rose 7.5 percent year-over-year in Baltimore's southern suburbs, 12.7 percent in the northern suburbs, 3.4 percent in downtown Baltimore and nearly 16 percent in the Fells Point/Inner Harbor area, Delta Associates says.
Back in April, the firm said rents rose modestly -- less than 2 percent -- with drops in some submarkets in the region.
I talked to Grant Montgomery, a vice president with Delta Associates, about the downtown apartment market during the spring and he said that few projects were being built -- which would be good for landlords once more people had the wherewithal to rent.
The firm says in its new report that the supply pipeline metro-wide "remained constrained." It predicts that demand for apartments will slightly outstrip the number of new units planned.
"Baltimore’s supply/demand imbalance indicates that occupancy will improve and rent growth is likely to continue at a modest pace over the next three years," Delta Associates says.
A recent national survey suggested more optimism among landlords, many of whom anticipated raising rents in the next 12 months. I noted these results in a post, and readers had interesting responses.
Wonk reader se_coupe, a renter in Columbia, shared a personal experience: "I saw my rent go up drastically in this most recent renewal. ... I made an inquiry with the leasing office. They claimed 'market conditions were improving' and that all lessees in the community would see an increase in their rent at their next renewal."
Mickey was puzzled by the suggestion that the balance of power was swinging back toward landlords: "There are tons of rental properties - half of the harbor strip is vacant, the new towers around Camden Yard too, the new neighborhood above Little Italy."
And a property manager going by "PropMngr" weighed in: "[M]y community is stable if not slightly better than last year as far as occupancy is concerned. Renewal increase range from $10 to $40 depending on apt type. That being said we have had to become more accommodating with rent payments. Offering programs to residents that were normally on time and due to the economy have become late payers. We have also seen bad debt rise as many who we have tried to work with realize they just can't and skip out."
Has anyone seen a 10 percent rent increase?